The impact of emerging economies on the global investment stage is still in its early stages. One significant example is the way in which new major players such as China and India have been focusing on Africa as a source of new projects and developments.
Much of this involves the mining industry, as the continent has a wealth of natural resources across a whole range of products and commodities. Various nations and regions are rich in coal, oil and gas, while other areas have traditional value for gold and diamond excavations.
Another major area is that of rare earth metals, which continue to play an important role in a wide range of new technology applications and only look likely to increase their market share in the coming years.
Canadian investors are also looking to new opportunities away from the more traditional markets.
This includes looking at situations in areas that were previously unconsidered due to the potential rewards of investing there.
Mining operations abroad can be very profitable as labour costs can be much lower and rapid growth a real possibility.
Certain tax advantages such as Exempt Market Products (EMPs) may also come into play making an investment even more attractive.
Greater potential rewards usually mean that there are associated risks too. In certain parts of Africa, years of political instability have left long term economic programmes in an unhealthy state. In others, natural and manmade humanitarian disasters make conditions unpredictable.
However, the stability, both political and social, that South Africa has to offer means it is seen by many as the gateway destination for international investors from all over the world.
With an established mining industry, it means that there is continuity for new projects. For example, the Krone-Endora project is located immediately adjacent to De Beers’ Venetia Diamond Mine in northern South Africa.
This particular project has recently announced the completion of an 8.4km power line to the site, completing the infrastructure requirements and meaning that 24/7 production can now begin.
The modern mining industry uses cutting edge technologies and advancements in working processes such as drilling and tapping, extraction and distribution are now more cost effective than ever.
This means that investors can look for solid returns without the worry of disruptions or downtime being caused by material failures. In the case of South African projects, the risks that might apply elsewhere in Africa are also virtually nonexistent.
This post has been provided by Mirage Machines, manufacturers and supplier of portable machine tools for on-site machining applications including drilling and tapping procedures.